Less than 20 per cent of Australians are now buying Australian, with imported vehicles taking 81 per cent of the record 1,049,982 vehicle sales last year.
The Holden Commodore was still the country's favourite car for the 12th straight year, but the swing to imports was reflected in the Ford Falcon's slide to a lowly fifth place in the ranking of best sellers.
It was beaten by the Mazda3 and the Toyota Hilux pickup.
The Mitsubishi 380 did not even make the top 10.
The strong performance of imported vehicles came as many more Australians turned to small cars and four-wheel-drives, which rebounded after the fuel shocks of 2006, in preference to locally made family cars.
Sales of 4WDs were up 16 per cent against an industry average of 9.1 per cent, while sales of light cars priced below $15,000 improved 10.2 per cent.
Toyota dominated the new-car results last year, taking its run at No.1 to five straight years, with a margin of more than 90,000 over second-placed GM Holden and a 128,000-car gap over Ford in third.
Toyota also lifted its sales to more than 200,000 and is aiming for 250,000 in 2008.
The one-million-vehicle milestone was a first for the industry but is expected to be bettered this year with sales of at least 1,060,000, according the Federal Chamber of Automotive Industries, which compiles the official VFacts sales results.
“Last year the motor vehicle market grew at approximately twice the rate of the economy as a whole,” FCAI chief executive Andrew McKellar said.
“One million new motor vehicles in a country of 21 million people is an impressive achievement."
“The Australian motor vehicle market has now grown in six out of the last seven years, driven by the strength of the labour market, rising asset values and improving vehicle affordability.”
Though Australia's sales rate of about 1 in 20 people was even better than Britain's 1 in 25, Mr McKellar sounded a warning.
“Although economic fundamentals remain strong and consumer confidence is proving to be robust, we think future growth will be more closely aligned with trends in overall domestic demand,” Mr McKellar said.
The industry also faces a review of federal government policy this year, with local carmakers arguing for an extension of the existing arrangements, including support from the Automotive Competitiveness and Investment Scheme.
They will point to the growth in exports in recent years, with overseas deliveries by GM Holden and Toyota now totalling more than $5 billion a year.
Toyota said the domestic sales of its Camry and V6 Aurion, which totalled close to 50,000 cars last year, were easily beaten by exports of more than 90,000 cars.
Our top 10 favourite cars
Ranking 2006 2007
Holden Commodore: 56,531 57,307
Toyota Corolla: 46,256 47,792
Toyota HiLux: 36,885 42,009
Mazda3: 32,432 34,394
Ford Falcon: 42,390 33,941
Toyota Yaris: 29,663 27,990
Toyota Camry: 24,221 26,336
Toyota Aurion: 3380 22,036
Hyundai Getz: 20,853 21,166
Holden Astra: 19,364 20,588